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Qantas confirms Emirates alliance talks

By David Flynn     Filed under: emirates, qantas, Etihad, Virgin Australia

UPDATE | Qantas this afternoon issued a media statement confirming it is in discussion with Emirates about a "potential alliance".

However, the airline says Emirates is just one of "a number of airlines" with whom potential alliances are being talked through.

"Strengthening alliance partnerships is one of the four pillars of the Qantas Group's five-year strategy. Qantas' policy is not to comment on the nature or status of these discussions."

PREVIOUS | Qantas is reportedly working towards a partnership with Emirates which would dramatically re-draw the Red Roo’s network map with the middle-eastern city of Dubai becoming a new hub for Qantas’s European flights.

The Qantas-Emirates partnership has been bubbling away for some months, and comes almost a decade after the two airlines abandoned plans for a code-sharing agreement.

But much has changed in the market landscape since then, with Emirates’ growth continuing almost unabated to become the world’s largest airline while Qantas seeks to stem the flood of red ink from its loss-making international arm.

 A report in today’s Australian Financial Review claims Qantas is “edging closer to a transformational alliance” with Emirates.

“The companies are holding late-stage discussions over a code share agreement that would see Qantas fly to Dubai for the first time and rely on its new partner to transfer passengers to destinations across Europe, the ­Middle East and parts of Africa” writes AFR aviation correspondent Andrew Cleary.

“Qantas would shift a proportion of its flights to London away from Singapore to transit via Dubai, and potentially add extra flights.”

The move would allow Qantas to either retire some of its some older less fuel-efficient aircraft or reroute them to “push into Asia more aggressively.”

“Executives from the two airlines have flown between Dubai and Sydney several times over the past two months, nutting out the framework for the code share” Clearly says.

However, “no agreement has been reached and there are ‘multiple sticking points’ that need to be resolved before any deal can be finalised.”

The move follows the Government’s approval for fellow middle-eastern airline Etihad to boost its share in Virgin Australia to 10%, with Etihad CEO James Hogan already admitting that his airline would consider raising its stake in Virgin as high as 19 per cent.

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About David Flynn

David Flynn is the editor of Australian Business Traveller and a bit of a travel tragic with a weakness for good coffee, shopping and lychee martinis.

 

Have something to say? Post a comment now!

1 on 26/7/12 by tronixstuff

Be wary of ongoing EK connections in the 777 aircraft, they use 10 across seating in Y. Ouch. 

1 on 26/7/12 by spudseamus

Yes I agree tronixstuff -- I am constantly banging away to T/a's  that I dont want codeshare as I'm not convinced that its fullfiling my expectations as a J class traveller .

2 on 26/7/12 by songman

If it means a more competitive and stable Qantas, then I'm all for it. 

3 on 26/7/12 by Performa

Not much in this story except in Australian media, hardly a mention in os media, inc EK website! EK is not looking for less exposure in Aus, due to huge investment and market. QF on otherhand invested in wrong a/c many yrs ago and did not retire a/c early enough, and is now exposed to all pressures associated w unwise decisions, blaming competition. There is always unlevel playing fields in these markets, and choices many yrs out need careful considerations.

1 on 26/7/12 by David

Well you wouldn't expect to see anything on Emirates' website as they are not commenting on it... and I wouldn't expect there to be much overseas media pickup barring the global business outlets (eg Bloomberg and WSJ, both of which have covered it) plus at some stage some middle-eastern media and of course the aviation circuit. As a Qantas story this is mainly of interest to Australian media.

1 on 26/7/12 by Performa

My point was of course to say,  that this is v unlikely to 'grow wings', as there is little advantage ( even as a feeder) for EK. They are not w any global alliance, (they have various code-share arrangements, that might be), they are a truly global player (hard ball), and they grew to their position through 'The Singapore Model', clever management ( Maurice Flanagan and Tim Clark) and smart fleeting. QF's lifeline has been JQ, even the Fed Gov's perfered os carrier to Europe is EY ! QF IFS is way behind competition, and marketing virtually does not exist. Competition is tough, and QF needs to be more pro-active, smarten their game, polish their act, and start delivering to remain, or otherwise demise!  

4 on 26/7/12 by Austline

I am a loyal QF platinum FF but have to agree with David, Qantas has a lot to answer for its current troubles, bad fleet planning, inconsistent service and serious staff  problems. Would an EK alliance help fix their Euro woes? I am not sure. When I buy a QF J ticket I like to travel on a QF aircraft with QF crew. I know this it is not possible on all routes, but pulling out of their last Euro port[FRA] is also not the answer. Frankly apart from access to the QF FF base I am not sure what EK would get out of this sort of alliance. I would have thought if you are going down this ME alliance path then QR, and trying to persuade them to join OW, would be a better way to go. EK make out that they are the best but their onboard service in J is average and th EK DXB J lounge is like a zoo a times.

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5 on 27/7/12 by rcooper

Unfortunately codeshares are not ultimately put in place to benefit the traveller, its brings a lot more financial benefit to the airlines involved . It creates so much annoyance for a traveller when they purchase a ticket on airline A because they like that airline to find that part or none of the journey is done on that airline  - its false advertisinig but for some reason it is allowed

Whatever partnership QF forms, your preference to fly their metal all the way will not be a key consideration in their decision making process.  Airlines know their frequent flyers are driven by status/lounge access and points, and the majority will continue to fly them regardless of the changes they make. Is that arrogant, absolutely and QF is one of the worst offendors for this, but if they do code share with EK and only take you as far as DXB  and then onto EK aircraft QF frequent flyers will adjust doesnt mean you like but they dont lose you

I dont see many benefits for this potential agreement with EK, unless its a fully blown agreement.  Sure they will gain Australian domestic codeshare access, access to the QF FF database - again they probably have quite a bit of it already, and it potentially gives them an additional 4 flights into Heathrow either through codesharing or buying QF's slots

It does however fit their strategic alliance approach that they have already put in place with PR TG KE and JetBlue.

For QF it would bring huge benefits - with one stop access to so many destinations in Europe/Africa and Middle East - as well as East Coast USA and South America - its quicker to fly PER/NYC via DXB than via SYD/LAX.

It would allow them to focus on Asia the big growth market and where their profits should lie, as well as building on US and South American services

Will be interesting to see how this develops

 

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